Most weeks in our training we publish a “sexy stat” about the company. It might be an obscure, cool thing like how our sign appeared in the movie Wakefield with Bryan Cranston carrying it, or some milestone.
This past April was a nice accomplishment.
On April 15th, we broke our record for properties put under contract for the month. You read that right; we passed the old record mid-month. When the dust settled, we more than doubled our best April ever, and had our very best month ever in the history of the brand with just an eyelash under $21 million put under contract. This says something. I often tell the agents that what you do today is your love letter to Future You in 60 days or so. Clearly, our team did some hard work over the past 90 days to make this happen, and May has kept up the momentum.
Spring is the busy cycle of the market and the wind was at our back to a degree, but we also rose to the task and made close to 50 clients happy. The market is robust but that doesn’t mean that every agent has it easy. Quite the contrary.
So, I tip my cap to my team on their hard work, their commitment, professionalism, and their grit. The best is yet to come.
First, some background: In late 2019, Long Island Newsday published the shocking results of an investigation where reporters of different ethnicities and races went undercover as prospective homebuyers and the different ways they were treated by the real estate agents they engaged. Long Island Divided made national news and reverberated across the industry as professionals were faced with hours of footage showing how white prospects were treated differently than their counterparts of color. It was awful to watch. White home buyers were treated far more favorably. Among the hurdles placed before black and Hispanic buyers were requirements for being pre-approved before seeing homes, being asked to sign a representation contract before seeing properties, and being asked to produce ID.
These things are not bad in and of themselves; a pre approval and exclusive right to represent are considered “best practices” before home shopping. The problem was that white home buyers seldom had these hoops to jump through. There was plenty of cringeworthy, disparate, and biased treatment that seemed awfully coincidentally tied to the race of the buyers, and the data reported on how white home buyers were treated compared to other races was damning. Worse, some of the companies reacted very poorly to the report.
In response, the state government passed a new law mandating an additional fair housing disclosure to be signed by all prospects at first substantive contact so the consumer would know their rights, and for the disclosure to be posted prominently in all real estate offices. No one was under the illusion that a piece of paper would change peoples’ hearts, but it did appear to make a difference in informing consumers of their rights.
But that wasn’t the end of it. This year, Albany passed another law requiring brokerages to publicly disclose a uniform standard operating procedure as on whether or not the brokerage would require a pre approval, exclusive representation contract, and showing identification before serving the consumer. On the face of it to the layperson that might seem reasonable. However, real estate agents are independent contractors with different business models. Asking for a pre approval up front is baked into the practices of many of our agents. Others are willing to meet up without a pre approval or proof of funds up front, and so long as the agent themselves are consistent, no bias could be explicated. It made sense (and is still the way it is in the other 49 states), that so long as an agent who would, for example, tell a $1000 rental prospect that rentals weren’t their specialty, that they wouldn’t suddenly be open to rentals with a $10,000 budget consumer. The law doesn’t see dollar amount in that example, it just saw bias that would unfairly affect folks with lower economic means, more likely to be minorities.
The new law, however, expands the bias to the entire brokerage without any consideration for details like agent safety, business models, or other circumstances. This made brokerages face difficult choices. If a company chose to not require pre approvals, for example, then it would be an infraction for an individual agent to practice a business model to require them. The converse would be the issue for brokerages that might require ID, financials, or an exclusive contract. The conundrum for brokerages with more than a handful of agents is the big tents so many companies have with the business practices of their independent contractors. Now, to the state’s credit, they aren’t making a judgement about requiring or not requiring these things in and of themselves; they want consistency. But making the consistency brokerage wide rather than for individual practices could be construed as overreach.
Some agents, for example require a pre approval ahead of time to verify the identity of the consumer for safety purposes. This is understandable. Other agents might not be concerned about safety so much. And circumstances can change. We meet strangers alone in empty houses for a living many times. Other times we meet people in crowded setting like a high trafficked apartment complex. This has nothing to do with the ethnicity or race of the consumer.
To complicate matters, these rules go out the window when a homes seller requires ID or a pre approval. Those preferences must be obliged regardless of company policy.
I predicted that larger firms would not require any of the three up front as a condition of service and smaller firms might be more likely. Since the operating procedures have to be on the company websites, I was able to confirm that I was correct.
I’ll also predict that more homeowners will be coached to require pre approvals so the brokerage community could be off the hook to a degree. Time will tell on that. The law may change after feedback from the industry to legislators, but it is also an incredibly sensitive thing to debate- no one wants to be the brand that might have appearance of being against any fair housing initiative.
This brand has chosen to not make ID, exclusive contracts, or pre approvals a requirement, as the graphic above says. We have a number of agents who have historically required them as a condition of service, and we are training our agents to be consistent in being sensitive to the different consumer preferences and refer a prospective client to a colleague in the firm when in the past they might have felt they weren’t a professional match. This will surely evolve, but I’ll agree with Albany about one thing: if we have to make a choice between the unbiased experience of the consumer and the convenience of the professional, the consumer must get the nod.
I don’t think I’ve seen the following thought written anywhere lately, but I’ll say it:
The average real estate agent has never worked harder than they have in this market.
That seems contrary to the public perception that rising prices and a “hot” market is when agents have it easy, but extreme conditions aren’t conducive to a leisurely business model.
For example, when an agent sells their new listing the first weekend that it’s active for more than asking, it not only doesn’t mean things are easier for them, it can have a deleterious effect on their bottom line.
Listing agent challenges include:
More difficulty procuring the listings. Competition is higher for the listing, and many homeowners need a plan on where they’ll go once they sell because that’s the biggest challenge. You have to have a detailed plan in beyond the sale, which is unheard of in any market I’ve ever seen before this one. Before this market the plan was “find a place to buy/move to.”
Bidding wars aren’t fun, and can get messy. The passions around housing are high enough, but try explaining to a colleague why their cash offer $50,000 over asking is in 3rd position. And there is no margin for error, as the devil is often in the details on offers, and missing a key term can cost. If you meet an agent with bags under their eyes, they were likely parsing the details of 6-10 offers with a nervous client to help them make a decision.
Appraisals can be a nightmare. When prices spike dramatically, the 6 month lookback at comparable sales is at lower cost transactions. Buyers can offer cash protection, but it’s not automatic and an appraisal $25,000 under contract price can spark some serious buyer remorse that reverberates to all parties.
Greed. Sellers view the current market as a once in a lifetime chance to ring the bell, but it can blur their common sense and cause them to have unrealistic expectations even if everything goes right. For example, suppose a listing goes active for $800,000 and sells for asking price within the first week. Great, right? But if the seller had a fantasy that they’d get $860,000 in a bidding war based on what they see on the news, they need to be talked off a ledge.
Lack of professionalism. There are 1.5 million members of NAR right now, up 50% from the housing crash. That means hundreds of thousands of rookie agents who have no substantive experience. When the market gets hot, old failures take their licenses out of mothballs, and newbies jump in with deplorably sparse training. Doing business with a poorly trained agent on the other side of a deal is brutal.
Loss of income. This is counterintuitive, but all too real. Less inventory spread over a dramatic increase in agents is bad enough, but the big aggregators are getting in on the commission via onerous referral fees. We used to pay for advertising on Zillow, Trulia, and Realtor.com. Now those companies take referral fees of 35% on a typical transaction, meaning that if you sell a $450,000 property your commission is more reflective of a $300,000 closing. So higher prices not only don’t mean more commission, they mean lower earnings spread over fewer transactions.
Other issues are more inside baseball, but the model of the industry has always been predicated on the longstanding idea that carrying a listing for any period of time will develop new prospective client relationships with inquiries on the listing. When the listing is gone the first weekend, that can’t happen. I understand this means little to the consumer, but it’s a factor that can’t be denied.
On the buying side, agents representing prospective purchasers are in trench warfare. Buyer agents in our firm have fewer properties to show their clients, and many of our successful buyers have not hit paydirt until their 4th or 7th attempt to buy. That’s madness. Worse, buyers are selling their souls to get accepted offers by waiving inspections, offering cash to make up for appraisal deficiencies, and in some cases even waiving mortgage contingencies. Surrendering your own security and exposing yourself to that kind of liability is not only stressful and risky, it can be destructive if everything doesn’t go perfectly.
In any industry, volatility is not a welcome thing. Stability, even if it’s considered boring, is a far better market condition. Give me boring any day. Leave the volatility for the Oscars.
Stay tuned for my next post on why this is brutal for consumers as well!
I got a question from a client about the effect that installing solar panels might have on their home’s value. It’s a good question, actually. Years ago when hurricanes knocked out power in our area for more than a week, I opined that backup generators would become the new status symbol. While I wasn’t wrong, green initiatives are gaining momentum and NAR even has a Green Housing certification for agents.
I plan on getting solar power in the near future. I see panels everywhere I go. I’m more interested in saving on my bills and not burning fossil fuels, but it is a good question- will solar panels increase value?
In all candor, this is not something I can speak to clearly on my own- the data is not too plentiful. Of the thousands of homes sold in Westchester in the last year, only a few dozen had solar. I can see why; the technology is relatively new and most people who install solar do so because they aren’t going anywhere anytime soon. So, there really isn’t a statistically significant number locally to go by.
That doesn’t help me answer the client’s question, so I did a little snooping around, and Zillow released a study in 2019 that confirmed that solar raises value by 4.1%. Zillow has way more data to crunch than I do, so there’s you’re answer based on their study. This is hard data and not an algorithm attempting to estimate value sight unseen, so I think the findings are reliable.
As I shared with my client:
My take is that there is no downside, leased or owned. There is no evidence I’ve ever found that said it harmed value. I think as time goes by more data will confirm Zillow’s finding.
I see more and more homes converting, and I’m planning on installing panels later this year so the trend is positive.
Younger buyers also prefer more green solutions and millennials comprise the bulk of the forecast of buyers in the coming years.
I’m relatively old. I remember Nixon resigning office, Tang commercials, news stories on the war in Vietnam, and lots of other things from when Kitchens were green and gold. I remember when mortgage interest rates topped 20% in the early 1980s, and my father telling my mother how rates didn’t matter, payment amounts did. He was an accountant, so he wasn’t playing out of position on that one.
Having lived through two housing crashes in my 54 years, I’ve become a student of what to look for so that what I endured in 2008-10 will never catch me unprepared again. So when I’m asked if rising rates will stall the market, I have to laugh.
A brief, immutable point before I go on:
People like living indoors. It’s not a fad. People will continue to live indoors no matter what.
Property values are funny things. They continue to rise in almost any environment: war, pandemics, Republican administrations, Democratic administrations, impeachments, killer bees, societal unrest, years the Red Sox win the World Series, almost anything. Why? Because people like living indoors. We are not a society of Bedouin nomads, camping enthusiasts, or Vikings. We like heat, plumbing, running water, and other creature comforts that come with permanent shelter. Property values only have one Achilles heel or kryptonite, and that is a near total financial collapse that results in banks not loaning money.
I’ll say it again: The two times in my life where values cratered were eerily similar: Billions of dollars in bad mortgage loans that caused a plethora of bank failures, resulting in a Stock market crash and a financial crisis where the mortgage industry got overcautious and values declined. In the late 80s, the massive Savings and Loan collapse preceded Black Monday in 1987, and a doozy of a recession that dealt a blow to values that didn’t recover until the early to mid 1990s. In the late 2000s, billions of dollars of subprime mortgages caused the subprime lenders to fail, and the resulting financial crisis hammered real estate more severely than anything since the Great Depression in the 1930s.
I’ll simplify the recipe:
Two scoops of bad paper loans
Bank failures due to bad loans
Financial crisis
Banks curtail lending
Values suffer due to buyers not being able to borrow
People have borrowed money and bought real estate despite wars, crazy rates, pandemics, terrorist attacks, inflation, bad Oscar years, crappy Star Wars sequels, and even New Coke. Why? Because people like living indoors. As a matter of fact, there is absolutely no historical correlation between rates and values. In 1975, the average home value was $38100. Rates that year were in the 9s. In 1981, rates approached 17% and property values nearly doubled from 6 years prior. In 2005, the average property value in the US was 232,000, with rates just under 6%, and in 2010 rates fell nearly a point but values fell to $222,000.
This isn’t to say that rates aren’t a factor. They are. I’ve written about this twice, and used the manipulation of rates to predict, rather accurately, both the crash of 2008 and the spike in values were are seeing today. By the way, I smile at the first old blog post from 2006 because my brother, the financial guru, made the following comment: “the stock market is likely to be in very good shape in 2008.”
I can’t speak to the current stability of the stock market, but I do know that there is a fraction of the amount of risky mortgage paper out there now compared to 2007 or 1986. And that bodes well for the health of property values for the foreseeable future.
Last week saw a posting by a manager at another firm of their agent holding up a commission check, congratulating the agent on their recent closing.
As we used to say back in the 80s, gag me.
Yes, I know we work on commission and closings should be celebrated. But spiking the ball over your compensation is cringeworthy and not edifying the profession. The public knows we are typically paid on commission. It’s no secret. But it’s just gauche to make a closing about the paycheck and not about the happy result for the client.
I’d get ill if the contractor who did my roof a few months ago posted a photo holding up my check for the job. Wouldn’t you? Years ago, I contracted a web provider for a specialized website for a project we were taking on. It wasn’t cheap, and when he thought I was on hold, I heard the guy tell a someone how he “just signed up a mac-daddy” deal. I wasn’t shy about the fact that I heard him, and the way he hemmed and hawed told me that he didn’t mean for me to hear that. No kidding. I had just made a difficult decision on a financial commitment, and his touchdown dance made me second guess my decision. Spoiler alert: I wouldn’t do business with them again.
Commission compensation for some is a touchy subject. My agents are worth every penny they are paid and more, but I’ve never posted a photo of them holding up a check, because that’s not where the emphasis should be. Yes, we are paid, but we are paid by taking care of the clients. THAT is where the focus belongs.
I’ll repeat that: Real Estate commission is tied to serving the clients. We are fiduciaries. We aren’t brain surgeons, but we shepherd the largest transaction of most people’s lives, and we should conduct ourselves to reflect that. You don’t see a surgeon posting a picture of themselves holding up a check and saying “I just removed a huge tumor! Yay me!” Nor would you ever see a CPA doing the same with a caption of how they just completed a massive schedule C for a client. And I’m fairly certain my therapist doesn’t have a pile of my co pays in front of a camera lens for social media either. Their emphasis is on who they serve, not what they get out of it. It should be the same thing with us.
Of course we celebrate closings. But to me the best way to do so is what many of my agents like Cristina Gameiro share: A 5-Star review from their client of their professionalism and performance. That says far more than a check.
You’ve read it before, unless you just learned to read (in which case house hunting is a long way off for you), on financial platforms, blogs, real estate websites, magazines, newspapers, and maybe even ancient hieroglyphs: get pre approved before you start looking at homes.
This is what you’ve never read from any credible source: sure, go ahead and start calling agents to show you listings before you speak to a lender. Why haven’t you seen it from any legitimate professional? Because it wouldn’t make any sense.
When COVID first hit, the entire industry marshaled the will to finally put their foot down and mandate that no one would tour a home without a pre approval. Consumers complied, and it didn’t even require an explanation because common sense shouldn’t. Showing confirmations didn’t go out without an e-mail with a COVID disclosure and a pre approval. In a huge cloud of Corona virus chaos, this was a silver lining. But as time went by and the pandemic numbers dropped, we got sloppy. People stopped being so cautious. And the small battalion of home seekers without a pre approval swelled into a wave of unvetted, approval free question marks that wanted us to open doors.
So, without further ado, here are more reasons why you should get pre approved first:
You won’t get your heart broken. In this market, listings go fast. If you see it on a Saturday, it’s going to highest and best by Monday. And the winning bid will have their complete act together. You won’t. And damn, you would have been so absolutely happy in that house.
You need to know what you can afford. In a world that rightly demands professionalism from agents, lenders, attorneys and everyone else involved, it’s the common sense, professional thing to do before shopping.
It’s only fair to the seller. When you visit a house for sale, that is someone’s home. They sleep there. They eat there. Children are raised there. And with the rare exception of vacant homes (which have their own rationale fore requiring a pre approval), those people will return there a few hours later to eat, sleep, and live. You are a guest. The seller, their kids, whoever is living there made arrangements to be out of the house to accommodate your visit. The seller has a right to know that the person walking through their children’s bedroom, opening their cabinets and closets, and spending time inside that home is at least qualified to make the purchase.
It’s safer. Real estate agents make a living meeting strangers alone in empty houses. When people call us and want to see those properties, virtually anonymously, that is a risk. I know too many agents who have had to deal with creeps, perverts, harassers, deluded suitors, and worse. I am the charter president of the Beverly Carter Foundation. Beverly was kidnapped and murdered by monsters masquerading as potential buyers. I want every single one of my agents to get home safely and with peace of mind, every day. No exceptions. And I don’t want to hear from a seller that something is missing, and not be able to tell them who was in the house. The graphic posted is a real text exchange encountered by a colleague. She’s sadly not alone.
It’s reasonable. When you test drive a $2000 used car, they get your license. If you buy spray paint they check your ID. If you want to buy cigarettes, they check your ID. Yet, if you want to walk through a 6 or 7 figure cost home you can’t possibly think it OK to not have any credential or qualification.
You have to play your part. Lots of people are involved in the sale of a home. Last year, I got a call from someone who said they were a cash buyer who wanted to see a vacant unit in a condo complex where they said they also lived. In checking the listing, it stated that no showings would be approved without proof of funds or a pre approval. She took some sort of offense to this, stated louder that she was a cash buyer, and that she’d provide proof if she was interested after seeing the place. Not only was this backwards, but she was making it all about her. That’s the kiss of death in any market, but in this market, that’s laughable. Sure the place is vacant, but the owner still incurs liability for an unsupervised property. An agent still needs to drive over and accompany the showing. The listing agent still needs to follow up. And the domino effect of their family, colleagues and other clients is no small thing. The value of other peoples’ time should never take a backseat to 5 minutes on your computers and hitting “print.” I’ll die on the hill that this person was curious and wanted a free tour guide to satisfy her inquisitiveness.
It’s absurdly easy. Upon occasion, we will have a prospective buyer tell us that their pre approval is “in process” or coming in a few days.Come on.I do this for a living.It takes 15 minutes to get pre approved unless you are a hot mess. This is the computer age. A few minutes on a call with a loan officer, an email with your last paystub and a bank statement, and you’re due for a shiny fresh pre approval letter within hours.
Some of the concerns we hear about getting pre approved are easily addressed:
No, it will not adversely affect your credit score. Buying a $200 dinner on your credit card will lower your score more than a single mortgage inquiry. You’d need dozens of inquiries to truly damage your credit score, because that would mean you are frantically trying to borrow. One, two or three inquiries from lenders over the course of weeks, or months is virtually meaningless.
As I said above, saying that you don’t want to waste your time getting pre approved unless you find a home you like is utterly selfish and insensitive to the value of the time of all the others involved in accommodating you. The buyer agent, the listing agent, the sellers, the other buyers who can’t see the home while you’re taking the time, the family and co workers of the aforementioned agents who lose time while they are with you, all disrupt their schedule to assuage your curiosity. That’s not cool. You don’t live in a bubble. If you do something that involves the time and help of other people, play your part or stay home.
You’re waiting for XXXX and want to get a head start? By the time XXXX happens this house is gone. So please wait and get your financial house in order.
And yes, dangling that you’ll list your home with us if we just show you this house first is also not cool. Let’s take a look at your house and ascertain that you are a ready willing and able seller first. Let’s not put the cart ahead of the horse.
If you sense an eye roll quality to the tone of my piece here, you aren’t wrong. I originated mortgages for 7 years. I’ve brokered thousands of transactions. I’ve done this every day since the 90s. I oversee close to 100 agents, and the exponential amount of interactions they have with the public in a fast moving industry like this, especially in the current market, boggles the mind. But I’m not writing this for them. Scroll up. I’m also writing this for you. Play your part and invest the 15 minutes in yourself.
While making a training video on market reports for the agents this past week, I clicked on an oldmarket report I wrote in November 2011for Ossining. Among other things, I noted that there were 119 single family homes available for sale in the school district at that time. In working on current data, I had to blink and see if the current inventory number was accurate, because it is cartoonishly low.
12.
There are 12 active single family homes in the Ossining School district, and that is at a time when the spring market inventory should be trending up. This has affected prices significantly- in November 2011, the median price was roughly $380,000. Today? $504,000. That’s almost a 33% increase.
Contributing to the low inventory is the reticence of those in a position to sell because they don’t see a viable housing option currently listed. That’s scary. My advice for prospective sellers who aren’t sure where they’ll go if they sell: Look at your options- sell subject to finding suitable property, make sure you have a flexible, extendable closing date, and, if you can, buy before you sell.
Buyers need to have their act together- make sure you have a pre approval for the house you want to see Sunday, because it will be gone by Monday to someone who already learned that lesson the hard way. Buyers in the market need to be locked, loaded and ready to go. The competition for such a small amount of options has never been tighter.
Writing the year’s wrap up used to be my New Years eve ritual, but with the scale of the job these days it’s impossible to quantify everything by midnight on 12/31. So let’s dive into my happy summary of a great year for the brand on the first business day of the new year.
The Numbers
2021 was by far the most cartoonish, crazy year I have witnessed in the industry, going back to 1996. Buyers were in the stiffest competition I’ve ever seen, and sellers were in the driver seat by a gigantic margin. This made life for listing agents comparatively advantageous (although nothing in this industry is truly easy), and for buyer agents it was trench warfare. I smile when people tell me that I must “have it easy” in this hot market, as they don’t know that the lack of balance complicates things enormously for all buyers, and no transaction can occur without a buyer. That difficult side of the puzzle notwithstanding, 2021 was the best year for J. Philip Real Estate by most conventional metrics.
Overall, the brand closed on over $150 million in volume for the first time in history. Last year we eked past $140 million but this year we were at $156 million, an increase of over 10%. We remain the top selling Westchester and Putnam county based independent brokerage for another year.
34 of our associates closed $1 million or more for the year, the highest total in the firm’s history. This means more to me than market rankings, because when someone entrusts their livelihood to us, we want them to be able to be a primary bread winner if they choose. One of my happiest stats is the sheer number of our professionals who are at that level of production. We have them by the dozen, and for a firm our size that is something we are fiercely proud of.
Another stat I pay close attention to is the amount of property we put under contract each week. Happily, we torched 2020 by nearly 11%, with close to $160 million put under contract, and that has us going into 2022 with good momentum.
We haven’t had our awards event yet, so I cannot make a shout out to recipients, but I can say confidently that this year’s list will dwarf that of prior years.
Accolades
Where to start? Chief Operating Officer Jenn Maher was an absolute superhero in 2021, instituting systems and architecture that epitomized the best practices of working on one’s business rather than just in it. The firm’s policies and procedures were revamped and updated, the managerial and administrative structure was rebuilt, streamlined and expanded, the Inside Sales Division was started, transaction management was expanded, and overall I can look you in the eye and say that if 300 new agents walked into the door tomorrow, we could onboard, train and deploy them as smoothly as if half a dozen did. Among other initiatives Jenn spearheaded was the adoption of an entire planning and accountability system used by the company leadership, the administrative staff, and all of the departments that support the sales force. We now have a crystalized 1, 3, and 5 year plan with clear objectives and the roadmap to make it happen. I’ll happily restate that $1 billion in annual sales has never been more attainable for us thanks to Jenn’s fine work.
Jenn was also a prolific producer of video content, with her “Success in Real Estate” broadcast developing a bigger following, and added to that was our joint “Real Estate Unscripted” broadcast every Monday. Providing licensees and public alike good informative content and commentary has been one of the best ways I have found to build the brand. This endeavor will grow into something special; mark my words on that.
Uber administrative renaissance woman Ronnie DeMeo was elevated to Chief Administrative Officer (CAO), and now oversees several large departments in the back office, as well as remaining my right had and the spiritual leader of the “Core Team” as Jenn terms them, the employee support staff that does admin, communications, sales support, and marketing. This past month the entire admin and management team met to plan the relaunch of the company systems, and I’ve never been in a room with so many smart, talented employees working together to forward the company’s vision. It was a sight to behold.
Josie Faranda stepped up significantly in 2021 as well, helping to tackle the firm’s enormous tech machine, as well as overseeing the fledgling Inside Sales (ISA) department, which is tethered to the aforementioned tech. Josie is quickly taking a complicated digital matrix and helping the personnel run it like a well oiled machine. The entire journey of the consumer from a raw inquiry for more information, to choosing a J Philip agent, through the closing has a cadence and written process that guides our training, agent support, and oversight.
Transaction Coordinator Michele Kantrowitz is among many smart, talented people who have stepped up and helped move our systems forward. Supporting the team in something as sensitive as shepherding the steps to closing a contract is something she does well, and the agents get enormous value from her contribution.
Other steps forward included:
The addition of a virtual CFO to oversee and manage the company finances
The start of the full renovation of two offices
A structured recruiting system with a budget to increase the size of our sales force
The adoption of a new CRM software that “sees around corners” thanks to artificial intelligence and predictive analytic programs
An equally high powered transaction management platform
Establishment of basic Boot Camp Training for new and experienced agents alike
A full compendium of both basic and advanced company training in our Trainual platform, thanks in large part to Lorei Kwok
The new Agent Leadership and Culture Committee with a more clearly defined purpose
Establishment of a Mentor Program for newer agents
A company lead program open to all agents, with the support of the aforementioned ISA program and Transaction Coordinator.
The elevation of Keri Kenny to Commercial Director
I am so humbled that this team of sharp, committed professionals has chosen this brand to share their talent. There are so many awesome people contributing it’s impossible to name them all. Many thanks to Brittany Alvarez for her great training contributions (and a big congrats on the new baby!), to Cristina Gameiro for her tenacious work and support in building out our team model, and so many others who rolled with the changes both inside the brand and out there in this industry.
Coming attractions
I announced at the end of last year’s wrap up that we’d roll out a new company website and expand the size of the brand. The new website went live in the first quarter, but I was not satisfied with it, so expect a better version of jphilip.com this winter.
We are working on expansion, and have hired a consultant to spearhead something special. Stay tuned there.
We see the future of the top producing agent significantly tethered to the team concept, which is essentially like a brokerage within the brokerage. Few traditional brands will admit this, but they aren’t excited about that idea. Teams are not as profitable as individual agents are to brokerages, but our plan is to scale the brand so that teams will be welcome, will flourish in our model, and the arrangement will be a win/win for all parties. I’ll restate it more clearly: J Philip Real Estate is enthusiastically a team-centric brokerage. Expect bigger and better teams growing with us.
Me, Myself, and I
Personally, I served my first year as a director of the Hudson Gateway Association of Realtors; I had been on the board of the MLS for a decade and served as president in 2014, but this was my first time on the association side of the organization. I also served another year on the board of the Beverly Carter Foundation, an organization committed to agent safety on the job. Locally, I was on the Ossining Historic Preservation Commission, and on the Committee for the establishment of the Sing Sing Prison Museum. My kids are healthy and doing well, I’m in a great relationship for close to 3 years now, and I wake up every morning feeling blessed and grateful.
The Wrap
I take no small amount of joy in observing that 2021 wasn’t just our highest production year, it was the year we built a bigger plane as we flew it. The absolutely gigantic projects we took on -simultaneously- certainly turned the agents’ collective heads as if we were crazy. To their credit, they hung in there, were supportive and comported themselves like the true professionals they are while we challenged them with so many changes. These are the people who make me feel confident in promising that before the next 5 years is over that J Philip Real Estate will be at over a billion dollars in annual closings. I love this bunch.
I can’t post a photo of all the awesome agents, but here is the team supporting them like nothing I’ve ever witnessed.
I recently closed on this listing for over $50,000 over asking price. This is an example of how values have grown in the area. The description of the home in the MLS is as follows:
“This is the village of Briarcliff Manor lifestyle you’ve sought in a 5 bedroom split that lives like a colonial. Master suite was an addition so you get 2 bedrooms with baths en suite. Balcony overlooking back yard will reveal a marvelous rear garden, a patio with custom masonry including a working stone oven & seasonal foliage to die for. Rectangular corner lot leverages the quiet tree lined neighborhood with ample room for recreation, gardening & entertaining. Two car garage plus parking for 6-8 cars easily. Inside you’ll fall in love with the spacious kitchen with garden views, living room with high ceiling & custom wood burning fireplace, dining room with doors to the back yard, and a family room on the lower level lots of light, access to the patio, and a half bath for convenience. Law Park with its fabulous pool and downtown are moments away by car. All bedrooms are roomy and boast ample closet space. Gas backup generator. Pride of decades long ownership shines through here!”
This one is sold, but we have more. You can call me at 914-450-8883 for more information.
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Most weeks in our training we publish a “sexy stat” about the company. It might be an obscure, cool thing like how our sign appeared in the movie Wakefield with Bryan Cranston carrying it, or some milestone. 
I don’t think I’ve seen the following thought written anywhere lately, but I’ll say it:
I got a question from a client about the effect that installing solar panels might have on their home’s value. It’s a good question, actually. Years ago when hurricanes knocked out power in our area for more than a week, I opined that backup generators would become the new status symbol. While I wasn’t wrong, green initiatives are gaining momentum and NAR even has a Green Housing certification for agents.
I’m relatively old. I remember Nixon resigning office, Tang commercials, news stories on the war in Vietnam, and lots of other things from when Kitchens were green and gold. I remember when mortgage interest rates topped 20% in the early 1980s, and my father telling my mother how rates didn’t matter, payment amounts did. He was an accountant, so he wasn’t playing out of position on that one. 
I’d get ill if the contractor who did my roof a few months ago posted a photo holding up my check for the job. Wouldn’t you?
You’ve read it before, unless you just learned to read (in which case house hunting is a long way off for you), on financial platforms, blogs, real estate websites, magazines, newspapers, and maybe even ancient hieroglyphs: get pre approved before you start looking at homes.
It’s safer. Real estate agents 
I recently closed on this listing for over $50,000 over asking price. This is an example of how values have grown in the area. The description of the home in the MLS is as follows:
On the Latest New York Standard Operating Procedure Law
These things are not bad in and of themselves; a pre approval and exclusive right to represent are considered “best practices” before home shopping. The problem was that white home buyers seldom had these hoops to jump through. There was plenty of cringeworthy, disparate, and biased treatment that seemed awfully coincidentally tied to the race of the buyers, and the data reported on how white home buyers were treated compared to other races was damning. Worse, some of the companies reacted very poorly to the report.
In response, the state government passed a new law mandating an additional fair housing disclosure to be signed by all prospects at first substantive contact so the consumer would know their rights, and for the disclosure to be posted prominently in all real estate offices. No one was under the illusion that a piece of paper would change peoples’ hearts, but it did appear to make a difference in informing consumers of their rights.
But that wasn’t the end of it. This year, Albany passed another law requiring brokerages to publicly disclose a uniform standard operating procedure as on whether or not the brokerage would require a pre approval, exclusive representation contract, and showing identification before serving the consumer. On the face of it to the layperson that might seem reasonable. However, real estate agents are independent contractors with different business models. Asking for a pre approval up front is baked into the practices of many of our agents. Others are willing to meet up without a pre approval or proof of funds up front, and so long as the agent themselves are consistent, no bias could be explicated. It made sense (and is still the way it is in the other 49 states), that so long as an agent who would, for example, tell a $1000 rental prospect that rentals weren’t their specialty, that they wouldn’t suddenly be open to rentals with a $10,000 budget consumer. The law doesn’t see dollar amount in that example, it just saw bias that would unfairly affect folks with lower economic means, more likely to be minorities.
The new law, however, expands the bias to the entire brokerage without any consideration for details like agent safety, business models, or other circumstances. This made brokerages face difficult choices. If a company chose to not require pre approvals, for example, then it would be an infraction for an individual agent to practice a business model to require them. The converse would be the issue for brokerages that might require ID, financials, or an exclusive contract. The conundrum for brokerages with more than a handful of agents is the big tents so many companies have with the business practices of their independent contractors. Now, to the state’s credit, they aren’t making a judgement about requiring or not requiring these things in and of themselves; they want consistency. But making the consistency brokerage wide rather than for individual practices could be construed as overreach.
Some agents, for example require a pre approval ahead of time to verify the identity of the consumer for safety purposes. This is understandable. Other agents might not be concerned about safety so much. And circumstances can change. We meet strangers alone in empty houses for a living many times. Other times we meet people in crowded setting like a high trafficked apartment complex. This has nothing to do with the ethnicity or race of the consumer.
To complicate matters, these rules go out the window when a homes seller requires ID or a pre approval. Those preferences must be obliged regardless of company policy.
I predicted that larger firms would not require any of the three up front as a condition of service and smaller firms might be more likely. Since the operating procedures have to be on the company websites, I was able to confirm that I was correct.
I’ll also predict that more homeowners will be coached to require pre approvals so the brokerage community could be off the hook to a degree. Time will tell on that. The law may change after feedback from the industry to legislators, but it is also an incredibly sensitive thing to debate- no one wants to be the brand that might have appearance of being against any fair housing initiative.
This brand has chosen to not make ID, exclusive contracts, or pre approvals a requirement, as the graphic above says. We have a number of agents who have historically required them as a condition of service, and we are training our agents to be consistent in being sensitive to the different consumer preferences and refer a prospective client to a colleague in the firm when in the past they might have felt they weren’t a professional match. This will surely evolve, but I’ll agree with Albany about one thing: if we have to make a choice between the unbiased experience of the consumer and the convenience of the professional, the consumer must get the nod.